The State Street Industrial Select Sector SPDR ETF (XLI) was launched on December 16, 1998, and is a passively managed exchange traded fund designed to offer broad exposure to the Industrials - Broad segment of the equity market.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 8, placing it in top 50%.
Index Details
The fund is sponsored by State Street Investment Management. It has amassed assets over $25.6 billion, making it the largest ETF attempting to match the performance of the Industrials - Broad segment of the equity market. XLI seeks to match the performance of the Industrial Select Sector Index before fees and expenses.
The Industrial Select Sector Index includes companies from the following industries: industrial conglomerates; aerospace & defense; machinery; air freight & logistics; road & rail; commercial services & supplies; electrical equipment; construction & engineering; building products; airlines; and trading companies & distributors.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.08%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.36%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector -- about 100% of the portfolio.
Looking at individual holdings, General Electric (GE) accounts for about 6.75% of total assets, followed by Caterpillar Inc (CAT) and Rtx Corp (RTX).
The top 10 holdings account for about 39.03% of total assets under management.
Performance and Risk
Year-to-date, the State Street Industrial Select Sector SPDR ETF has gained about 20.26% so far, and is up about 15.79% over the last 12 months (as of 12/16/2025). XLI has traded between $116.42 and $157.73 in this past 52-week period.
The ETF has a beta of 1.04 and standard deviation of 15.7% for the trailing three-year period, making it a medium risk choice in the space. With about 82 holdings, it effectively diversifies company-specific risk.
Alternatives
State Street Industrial Select Sector SPDR ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, XLI is an outstanding option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Vanguard Industrials ETF (VIS) tracks MSCI US Investable Market Industrials 25/50 Index and the First Trust RBA American Industrial Renaissance ETF (AIRR) tracks Richard Bernstein Advisors American Industrial Renaissance Index. Vanguard Industrials ETF has $6.43 billion in assets, First Trust RBA American Industrial Renaissance ETF has $6.47 billion. VIS has an expense ratio of 0.09%, and AIRR charges 0.7%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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State Street Industrial Select Sector SPDR ETF (XLI): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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